In this undated photo, visitors look at information boards in Kuaishou's booth during a high-tech exhibition in Beijing. (PHOTO PROVIDED TO CHINA DAILY)

Chinese startup Kuaishou, backed by Tencent Holdings Ltd, is considering an initial public offering in the Hong Kong Special Administrative Region (HKSAR) which could raise as much as US$5 billion, according to people familiar with the matter.

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The company is working with advisers on the share sale, which could happen as soon as early next year, said the people, who asked not to be named as the information is private. Details of the offering including size and timeline could still change as deliberations are at an early stage, the people said.

The company is working with advisers on the share sale, which could happen as soon as early next year, said the people, who asked not to be named as the information is private

A representative for the Chinese startup declined to comment.

Kuaishou, or “fast hand,” is the biggest Chinese rival to Douyin, ByteDance Ltd’s domestic version of short-video sharing app TikTok. Kuaishou established its popularity among users in the country’s smaller cities and rural areas, with people streaming slices of everyday life from harvesting corn to slurping noodles. It later expanded to include audiences in bigger cities, and content ranging from people playing video games to teenagers lip-syncing songs. It has been overtaken by Douyin in popularity, thanks to ByteDance’s mastery of algorithms that determine what videos to show users next -- and to keep them hooked.

Kuaishou generates the bulk of its revenue from taking a cut out of the tips users give to their favorite live-streaming performers. But it’s also increasingly expanding into advertising and e-commerce. The Beijing-based company has a deal with China’s No. 2 online retailer JD.com Inc to sell products through an in-app store, and said it has amassed more than 100 million daily active buyers.

Kuaishou’s business is so far largely focused on the Chinese mainland. Downloads of its Zynn short-video app spiked in recent months in the US, as lip-syncing teens sought TikTok alternatives in the face of US President Donald Trump’s ban. 

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In July, the company hired former Didi Chuxing executive Tony Qiu to oversee its global expansion, according to the people. Qiu reports directly to the co-founder and Chief Executive Officer Su Hua, one of the people said.

The startup was considering a US IPO last year to bankroll its expansion and fend off competition, Bloomberg News has reported. Kuaishou was raising more than US$1 billion at a US$25 billion valuation in a funding round last year, a person familiar with the matter said at that time. Its valuation has recently risen to at least US$29 billion in the secondary market, the people said.